Starbucks to reach above estimates for its 2021 earnings
On Thursday, Starbucks Corp (SBUX.O) announced that its earnings forecast in 2021 were above estimates in light of strong demand for online orders and a recovery in the restaurant industry amid the coronavirus pandemic.
The American multinational chain of coffeehouses and roastery reserves stated that it was forced to shut down many branches and limit operations to takeout and delivery only during the coronavirus crisis. However, its sales had improved as customers used the Starbucks app to order and collect their drinks at stores.
Starbucks’ sales fell by 9% in its fourth quarter, beating Wall Street estimates of a 12.1% decline as customers gradually returned to their morning routines.
Starbucks’ shares went down by more than 1% in after-hours trading on Friday.
Starbucks’ Chief Executive Officer Kevin Johnson said that the firm’s recovery in the United States and China was faster than expected.
The coffeehouse company said that it expects adjusted revenue for the next fiscal year worth $2.70 to $2.90 per share. According to Refinitiv’s IBES data, analysts had forecast $2.74 per share.
“Most of Wall Street figured that (Starbucks) would trail other restaurant companies until things return to normal and people started going back to work at the office,” Edward Jones’s Analyst Brian Yarbrough stated.